Context:
The Draft National Electricity Policy (NEP) 2026 proposes a major shift toward nuclear energy expansion, tariff rationalization, and structural reforms in India’s power sector.
Key Highlights:
Nuclear Expansion
- Target to increase nuclear capacity from 8.8 GWe to 100 GWe by 2047.
• Focus on Small Modular Reactors (SMRs).
• Aligns with reforms under SHAKTI Act encouraging private participation.
Tariff & Financial Reforms
- Index-linked automatic tariff revisions proposed.
• Exemptions from cross-subsidy charges for manufacturing, Railways, metro systems.
• Focus on reducing AT&C losses.
Energy Demand Projections
- Per capita consumption target:
- 2,000 kWh by 2030
- 4,000+ kWh by 2047
Renewable & Grid Stability
- Support for renewable energy expansion.
• Emphasis on energy storage systems for grid reliability.
Relevant Prelims Points:
- National Electricity Policy 2005 preceded current draft.
• SMRs – smaller, modular nuclear reactors.
• Cross-subsidy – higher tariffs for some to subsidize others.
• AT&C losses include technical + commercial losses.
• Nuclear power regulated by Atomic Energy Regulatory Board (AERB).
Relevant Mains Points:
- Economy (GS 3)
• Financial sustainability of discoms.
• Industrial competitiveness via lower power tariffs. - Science & Technology (GS 3)
• Nuclear energy as low-carbon baseload source.
• Role of SMRs in energy transition. - Governance (GS 2)
• Regulatory reforms in tariff-setting.
• Balancing affordability with cost-reflective pricing.
Way Forward
- Ensure strong nuclear safety oversight.
• Gradual cross-subsidy rationalization.
• Invest in grid modernization and storage.
• Integrate nuclear with renewable energy strategy.
UPSC Relevance:
GS 3 – Energy Security, Economy, Nuclear Technology
GS 2 – Governance & Policy Reform